Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Thursday, August 29, 2013
Higher Interest Rates - Bond Vigilantes Hold Upper Hand Over Central Banks / Interest-Rates / International Bond Market
By: Gary_Dorsch
Whenever former Fed chief Alan Greenspan was praised for delivering a clear message on US- monetary policy, he used to reply, "I guess I should warn you. If I turn out to be particularly clear, you've probably misunderstood what I've said." On June 7th, Greenspan set off the alarm bells on Wall Street by telling viewers of CNBC that the time had arrived for the Fed to begin tapering its $85-billion a month bond buying binge, even if the US-economy isn't ready for it. "The sooner we come to grips with this excessive level of assets on the balance sheet of the Federal Reserve, - that everybody agrees is excessive, - the better," he said in a "Squawk Box" interview. "There is a general presumption that we can wait indefinitely and make judgments on when we're going to move. I'm not sure the market will allow us to do that."
Wednesday, August 28, 2013
The Global QE Exit Crisis, Guidance Schmidance / Interest-Rates / Quantitative Easing
By: John_Mauldin
In last week's Outside the Box, which included a paper from the San Francisco Federal Reserve on the effectiveness of quantitative easing, I wrote, "What [authors] Cúrdia and Ferrero are really saying is that the latest round of QE, massive as it has been, has not had all that much effect on the economy, and that other factors should be taken into account. I'm sure this thesis is somewhat controversial, and I look forward to seeing what QE proponents like David Zervos over at Jefferies have to say about it."
Monday, August 26, 2013
Will the Last Person to Exit the Treasury Market Please Turn Out the Lights / Interest-Rates / US Bonds
By: Michael_Pento
Wall Street and Washington love to spread fables that facilitate feelings of bliss among the investing public. For example, recall in 2005 when they inculcated to consumers the notion that home prices have never, and will never, fall on a national basis. We all know how that story turned out. Along with their belief that real estate prices couldn't fall, is one of their favorite conciliatory mantras that still exists today. Namely, that foreign investors have no choice but to perpetually support the U.S. debt market at any price and at any yield.
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Sunday, August 25, 2013
The Truth about the Real Size of the US National Debt / Interest-Rates / US Debt
By: Pravda
Everyone got used to the largest officially announced U.S. national debt of 16 trillion dollars. Moreover, despite the dire predictions, the global economy seems to be more or less stable, and recently liberal media have been happily reporting GDP growth in the United States and the European Union. However, it is not all that great.
Saturday, August 24, 2013
U.S. Treasury Bonds Are Oversold / Interest-Rates / US Interest Rates
By: Sy_Harding
Has there ever been an asset class bombarded by such intense negativity in such a short period of time? Fed Chairman Bernanke’s warning in May that the Fed would soon begin to ‘taper’ its QE bond-buying stimulus program brought ‘The End of Bonds’ headlines out in force. And bond investors responded.
Friday, August 23, 2013
Shorting U.S. Treasury Bonds, Your No1 Choice for Big Gains / Interest-Rates / US Bonds
By: Money_Morning
Keith Fitz-Gerald writes: As I'm writing this, halfway through Wednesday's session, stocks are in danger of closing in the red for a fifth straight day. And this is all you'll hear about today.
Yet bonds are telling you the real story.
In fact, at this point, they are the next best thing to the Holy Grail if you've got the right perspective and understand what's happening.
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Friday, August 23, 2013
Major Bond Market Top, Dangerous Myths About Rising Yields / Interest-Rates / US Bonds
By: EWI
Myth 1 of 3: Bond Yields Are Rising Due to the Fed's Insinuation at Tapering
Editor's note: The following article is the first in a series of three, reprinted with permission from market-leading financial forecasting firm Elliott Wave International. To read the full three-part report now, follow this link and download it for free
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Wednesday, August 21, 2013
Dangerous Myths About Rising U.S. Treasury Bond Yields / Interest-Rates / US Bonds
By: EWI
Myth 1 of 3: Bond Yields Are Rising Due to the Fed's Insinuation at Tapering
Editor's note: The following article is the first in a series of three, reprinted with permission from market-leading financial forecasting firm Elliott Wave International. To read the full three-part report now, follow this link and download it for free
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Wednesday, August 21, 2013
What Has QE Actually Accomplished? / Interest-Rates / Quantitative Easing
By: John_Mauldin
The market is obsessed with “tapering.” The assumption is that all the “juice” in the economy is somehow the product of the Federal Reserve's actions. The headline on the front page of the Wall Street Journal today reads “Fear of Fed Retreat Roils India.” I suppose one has to come up with some kind of reason to explain the convergence of emerging equity markets and those of the US. My friend Dan Greenhaus over at BTIG sent out this ugly graph (if you are an emerging-market investor) this morning:
Tuesday, August 20, 2013
QE Party is Ending, Rising Interest Rates Means the Fed Could Go Bankrupt / Interest-Rates / US Interest Rates
By: Graham_Summers
The QE party is ending. And the following hangover is going to be brutal.
Since 2007 the Central Bankers of the world have operated under the belief that they can hold the financial system together by engaging in round after round of Quantitative Easing (QE) without losing control of the bond markets/ interest rates.
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Tuesday, August 20, 2013
Rising Treasury Yields, Tight Money Has Already Started / Interest-Rates / US Interest Rates
By: Clif_Droke
Aside from the fact that the 10-Year Treasury Yield Index (TNX) is rising, one reason for the recent equity market sell-off is the uncertainty generated by the Fed's latest announcement concerning the future of QE3.
At its latest press conference, Fed Chairman Bernanke indicated the central bank could start winding down its $85 billion/month asset purchase program in September. This has understandably caused a certain amount of consternation on Wall Street, especially given the feeling among many traders that QE has been largely responsible for the stock market's rebound.
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Tuesday, August 20, 2013
Fed QE Taper Talk, Act 2 / Interest-Rates / Quantitative Easing
By: Axel_Merk
While the Fed’s taper talk has been tapered and then un-tapered, the market may now be tapering the Fed rather than vice versa. Let’s assess Act 2 of the taper talk and the implications for the markets, including the dollar and gold.
Monday, August 19, 2013
The Fed Can’t Afford to Taper QE / Interest-Rates / Quantitative Easing
By: John_Handbury
The Federal Reserve Bank’s balance sheet looked pretty healthy in May this year. On the asset side of the balance sheet is the large amount of paper that the Fed has bought to supposedly stimulate the economy. This consists mostly of treasury bonds and notes and mortgage-back securities of a value approaching $3 trillion.
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Friday, August 16, 2013
Is the U.S. 30 year Treasury Bond Market Top Finally In? / Interest-Rates / US Bonds
By: WavePatternTraders
After hitting my long awaited target, the reversal we have seen over the past 12 months strongly suggests a multi-decade top is now in for bonds.
Wednesday, August 14, 2013
U.S. Debt Nears a Tipping Point, Dire Economic Consequences / Interest-Rates / US Debt
By: Money_Morning
Garrett Baldwin writes: As U.S. debt as a percentage of GDP hovers at levels not seen since World War II, concerns are growing that the American economy is susceptible to a debt crisis in the near future.
Here's why people are worried: If interest rates return to normal levels of around 5% as the U.S debt approaches $20 trillion, then servicing that debt each year will cost taxpayers $1 trillion.
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Tuesday, August 13, 2013
How to Play the Coming Bond Market Crash / Interest-Rates / International Bond Market
By: Investment_U
Alexander Green writes: You know it’s coming. Every experienced investor who is paying attention knows it’s coming. I’m talking about the upending of bonds that will take place in the months and years ahead. However, there is a smart, low-risk way to play it… and earn a decent return.
Let’s start with the basics. Picture a seesaw with interest rates on one side and bond prices on the other. When interest rates go down, investment-grade corporates and Treasuries go up. When interest rates go up, these same bonds go down.
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Wednesday, August 07, 2013
Bank of England 0.5% Interest Rates for 7% Unemployment, to Result in 7% Inflation, Ongoing Savings Theft / Interest-Rates / UK Interest Rates
By: Nadeem_Walayat
"We won't even begin to think about raising interest rates until we see the unemployment rate go to 7%" - Mark Carney. With that the new Governor of the Bank of England did away with over 4 years of Mervyn Kings smoke and mirrors propaganda of temporary emergency low interests of just 0.5%, and money printing of £500 billion, the consequence of which is theft of purchasing power from savings and worker wages by means of high real inflation, transferring this stolen wealth to the bankrupt banking crime syndicate, and the government so that it can continue to maintain vested interest voting blocks, by bribing the electorate with debt and printed money that is not backed by any economic activity.
Wednesday, August 07, 2013
The Federal Reserve Relies on a Flawed Economic Model / Interest-Rates / Quantitative Easing
By: Casey_Research
By Lacy H. Hunt, Ph.D., Economist
In May 22 testimony to the Joint Economic Committee of Congress, Fed Chairman Ben Bernanke issued another of many similar positive interpretations of central bank policy. Yet again, he continued to argue that quantitative easing has decreased long-term interest rates and produced other benefits. He called economic growth "moderate," a term that he has often used without acknowledging that the Fed's forecasts have repeatedly been far above the mark. Within less than two months—or by the time of the July FOMC meeting—the Fed had downgraded the economic growth to "modest," tacitly acknowledging that program of open-ended $85 billion purchases of government and federal agency security purchases had failed to boost economic activity.
Wednesday, August 07, 2013
Debt, Income and Economy - Trying To Stay Sane In An Insane World / Interest-Rates / Global Debt Crisis 2013
By: James_Quinn
“I mean—hell, I been surprised how sane you guys all are. As near as I can tell you’re not any crazier than the average asshole on the street.” – R.P. McMurphy – One Flew Over the Cuckoo’s Nest
"Years ago, it meant something to be crazy. Now everyone's crazy." - Charles Manson
"In America, the criminally insane rule and the rest of us, or the vast majority of the rest of us, either do not care, do not know, or are distracted and properly brainwashed into acquiescence." - Kurt Nimmo
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Sunday, August 04, 2013
If You're Worried About Rising Interest Rates, Look at This Chart / Interest-Rates / US Interest Rates
By: DailyWealth
David Eifrig writes: "Don't fight the Fed."
You can hear that phrase on bond-trading desks throughout Wall Street. It's a warning to investors and traders. Don't try to outthink the central bank or anticipate its next moves...